I boosted my Alphabet stake by 10% this morning. I think my recent coverage of the name explains that decision well. All search data I’ve seen lately is positive. At Alphabet’s recent investor event, it talked about rapid Gemini growth, expeditious Lens momentum and AI overviews delivering a 10% overall uplift to user engagement.

While there are anecdotes about ChatGPT taking a larger piece of the search pie, that’s not overly concerning to me. The 10% uplift paired with the vast use case expansion GenAI entails means the mega cap “losing ground” is really just GenAI creating new search market share.

Furthermore, there are data points from various 3rd-party sources (that we covered over the last few weeks) showing Gemini beating all other competitors in monthly user adds and re-taking market share. So not only is it ok with me that Google may have a modestly smaller piece of a larger overall market… but that smaller piece may not even be a concession we need to make.

This is arguably the best-positioned full stack AI play. Their chips are now good enough for not just Google Cloud, but OpenAI and other AI darlings too. Their base of multi-modal data is unmatched, which is why their large language model (LLM) leads have been so convincing and durable.

YouTube is a gem, the cloud business is a gem (pre-Wiz integration), Waymo is a budding gem and quantum computing could eventually turn into a gem. There’s so much going right for this business, while I don’t see anti-trust lawsuits interrupting its momentum. All of this is true while it trades for about 18x forward GAAP earnings. That’s several turns lower than the next cheapest Mag7, and leaves room for multiple expansion, while it continues to steadily grow profits at a 10%+ clip. Many names have gotten ahead of themselves during this recently aggressive rally. Alphabet is one that hasn’t and is one that I want to own more of.

Other portfolio management notes:

I have not trimmed any SoFi shares following the recently explosive rally. The last time I trimmed was right around these levels early this year. I think I’d probably consider taking some chips off the table around $20/share (60x forward earnings and a PEG ratio near 0.9x). That still wouldn’t make it expensive, but this business model is inherently more cyclical than most of the names I own. So I do want to take some modest profits as the fun parts of the cycle play out. Not yet… but potentially soon.

Finally, I’m eyeing Servicenow for a new position. I think if there’s any kind of market-wide correction, that would be first on my list of new companies to own. My recent earnings reviews on the name explain that bullishness well. I’ve been impressed with their GenAI software monetization and see this steadily compounding profits at a 20% clip for several years. If I make a decision to own it, I’ll explain why in more detail at that time.

The two charts below are the same. The primary source is just hard to read, so I include the second.